Kenya and Rwanda are working toward a regulatory framework that could allow fintech companies to operate across both markets using a single licence, potentially removing one of the biggest barriers to regional expansion for African digital payments firms.
The initiative follows a memorandum of understanding signed by the Central Bank of Kenya and the National Bank of Rwanda aimed at simplifying licensing procedures and strengthening cross-border financial services between the two countries.
Under the proposed system, often referred to as a ‘licence passporting framework’, payment service providers licensed in one country would be able to operate in the other without going through a completely new licensing process.
Regulators would instead recognise each other’s approvals while maintaining joint oversight and supervisory cooperation.
Currently, fintech startups seeking to operate in both Kenya and Rwanda must obtain separate licences in each jurisdiction.
This duplication increases compliance costs and slows down regional growth for companies building cross-border payment infrastructure.
Regulators say the new framework aims to reduce those barriers while preserving regulatory safeguards.
By promoting mutual recognition of licensing regimes, authorities expect the initiative to support the responsible expansion of fintech firms while strengthening collaboration between the two central banks.
If implemented, the framework could accelerate the growth of East Africa’s digital payments sector by making it easier for companies to scale across markets.
Kenya already hosts one of Africa’s most advanced mobile money ecosystems, while Rwanda has positioned itself as a regional fintech innovation hub.
The agreement builds on years of financial sector cooperation between the two countries and reflects a broader push across Africa to harmonise financial regulations and support cross-border digital trade.
For fintech startups, the change could significantly reduce the time and cost required to enter neighbouring markets, potentially encouraging more companies to build services that operate across the East African region rather than within single national markets.
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